>> tell the truth, and you will be attacked. it's happening now to mitt romney. good morning, everyone. wealthy people may pay more in a romney administration. one. governor's campaign advisors say tax rates on the rich might come down, might not come down so much. and deductions for the rich will be cut. so, now his tax plan is being called ambiguous. that's the attack. no ambiguity about today's numbers, revision down on the growth rate down to stall speed and a huge drop in orders for cars, trucks and machinery. we're headed to election in 40 had days, are we head today recession? a clean cut call for you, the refs will be back tonight. the nfl caved. watch out, an all-star lineup for you. "varney & company" is about to begin. [ male announcer ] what if you had thermal night-vision goggles, like in a special opsission? you'd spot movement, gather intelligence with minimal collateral damage.

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ichltd >> good thursday morning, football fans rejoice. there will be no more amateur calls starting tonight. first, two tax stories involving mitt romney and he's going to get blasted for both. number one, he set up a trust for his children and grandchildren in 1999. that trust reaped big returns. if he's given the cash as a gift. it would have been taxed heavily. instead he avoided those taxes and the mainstream media will probably maybe have a field day with that. second, governor romney was in ohio yesterday and warned voters that his tax cut plan might not decrease tax bills as much as some might expect. here is why. >> by the way, don't be expecting a huge cut in taxes because i'm also going to lower deductions and exemptions, but by bringing rates down we will be able to let small businesses keep more of their money so they can hire more people. stuart: romney told the truth and the media is going after him for it. they call this tax plan now ambiguous. well, in a few minutes, business

strategist carol roth will give her take on the romney tax plan. now, perhaps the biggest story in the country this morning, america's national nightmare is over. we've he heard that line before and we're hearing again. the nfl with a deal with the locked out refs. the real refs will take the field in baltimore tonight for the ravens-browns game. according to fox news.com, the deal includes pay raises and pension guarantees for the officials. at the top of the hour, ten o'clock, nfl hall of fame quarterback fran tarkenton joins "varney & company," how much money did the refs get, exactly how much? of course, did they win? sure looks like it. please go to our facebook page and tell us what you think about the real refs coming back. do you think every call they make will be correct? what's the big deal? why did this grip america? follow us on facebook, we'll read some of your comments on the air next hour. smith electric, the latest green

energy struggling if backed company. it's not making as many as it's supposed to. president obama was there and extolling the company and the government's role in it. and form mayor rudy guiliani joins us to talk about romney and taxes, is romney is good candidate? we'll ask him. and nokia and research in motion, the down side of apple's success. we'll follow them at the opening bell next. sometimes investing opportunities are hard to spot. you have to dig a little. fidelity's etf market tracker shows you the big picture on how different asset classes are performing, and it lets you go in for a closer look at areas within a class or sector that may be bucking a larger trend. i'm stephen hett of fidelity investments. the etf market tracker is one more innovative reason serious investors are choosing fidelity. get 200 free trades today

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>> we're still expecting a 50 point gain for the dow when that opening bell stops ringing and we start trading, but there's a big negative number out there this morning, released about an hour ago. gdp, gross domestic products, our big picture economy grew only at an annual rate of 1.3% in the second quarter. i said before, that's stall speed. i mean it. that's very, very low rate of growth. 4% the end of last year, 2 1/2% early this year, now, 1.3, that's a nasty down trend. all right, the markets opened, we did expect an up trend, up tick in the opening bell. we've got it. 25 points higher, ultimately maybe 50 points higher within the next couple of minutes. i want to call this the iphone

effect. nokia may cancel its dividend in the face of big time competition from the iphone. okay, nicole, where did nokia shares open? let's start with them. >> they're a winner today. up 2.5%, all right? up 2 1/2%. cutting the dividend is certainly not good news, but they've priced their knew lumia, more than the samsung galaxy so they're pushing a new phone now and that's where the euphoria is surrounding nokia. stuart: i've got to say i don't get that. priced the new phone higher than the galaxy and now it goes up. and blackberry, research in motion, that stock has been all over the place. >> all over the place has been higher. up 2 1/2 today. through yesterday's close for the week, it was up 8 1/2% so say it's up almost 10% this week

alone ahead of their numbers. >> nokia and research in motion, day traders favorites, believe me. low priced stock in and out in five minutes. >> i love it when we believe you. stuart: and dow jones industrials average 56 higher. 13, 468 right now. mitt romney told voters his tax plan might not decrease tax bills as much as they might expect. is he backtracking and telling the truth? and joining us is former new york mayor rudy guiliani. if is he backtracking if they don't get the 20% tax rate cut and cut the deductions which these people get even more, is he backtracking? >> i think he's trying to put the emphasis on deficit reduction because many'

probably, guessing, i haven't seen it, in the polling probably concerning people more than anything else. as long as people can feel, i'm not going to get a tax increase, might think he's producing about as much enthusiasm as optimism as he needs to produce to get our economy going. stuart: i'm reading between the lines, you don't care for that. >> i'm a big tax cutter, cut taxes 23 times as mayor, 3 billion. it worked for me. i cut the hotel tax, collected more from the lower tax than the higher tax, i'm convinced if you got rid of the sales tax in new york you'd see another 500,000 jobs here. you'd make it up in income tax what you lose in sales tax. stuart: is governor romney then responding to the attacks from the obama camp that say you just want to cut taxes for the rich and that attack line is working? so governor romney pulls back and says, oh, we're not going to cut taxes as much-- >> i suspect it has more to do with internal polls and people

worried about the deficit and wants to show he's serious about the deficit. one of the things he's delivering immediately is, he gets elected president, bush tax cuts remain we don't get a big tax hike looking at 15% capital gains tax next year instead of 20, 25, 30%, 15% dividend tax instead of a 48%. and in the bush tax cuts exspiring translates into the biggest tax cut maybe in the history of america and focuses on that way, because the obama speed prevails. stuart: i just reported that the economy is 1.3%, 8 percent, you know the story. how do you explain? with na big economic performance, president obama still leads in the polls, especially in the key state of ohio. >> the way i explain it, media coverage that's off the charts outrageous, it's lying playing in basketball game and i get two points for a basket and you get 10. it's ridiculous. >>, but are the polls accurate?

>> they are he' accurate and according to the poll yesterday. i told you this before. i think if they were selling securities we'd put them in jail for securities fraud. stuart: you want to explain that one. >> i can eplain that one they used the 2008 model of turnout, a lot more democrats turning out and added more democrats in the the 2008 turnout. no way in a million years obama's going to get the 2008 turnout. maybe he's going to do better than 2010, where the republican turnout was tremendous. an honest pollster probably split the difference between 2008 and 2010. stuart: karl rove told us it's a dead heat. >> when i looked at that poll and studied it carefully i say it's about a 3% obama advantage in ohio now that's good news for obama, but not over. and romney can still catch up. stuart: your honor, that would be mayor rudy guiliani, thanks for joining us. much obliged to you. >> thank you, sir. stuart: most polls have romney and obama, well, some of the

polls, especially those that take a poll of likely voters, they've got president obama and governor romney pretty close. but doug schoen, now he's a pollster with 35 years of experience says we're doing the voters a major disservice by focusing on those polls. he says there's something missing. we'll have the full story for you, it will be one of our new at ten stories and doug will join us to talk about it, with us the full hour at ten o'clock. president obama continues to double down on green energy. smith electric received 32 million dollars of taxpayer grants to build a battery powered vehicle factory in kansas city. here is president obama visiting that plant in 2010. >> one of those decisions was to provide critical funding to promising innovative businesses like smith electric vehicles. and because we did, there's a thriving enterprise here instead of an empty, darkened warehouse.

because of the grant that went to this company, we can hear the sounds of machines humming and people doing their work instead of just the ghostly silence of an emptied out building and the memory of workers who were laid off a long time ago. stuart: hold on, hold your horses. the president could have another solyndra on his hands. smith electric promised to make 620 trucks this year. it then cut the estimate to 380 and in june made only 79. and after weak investor demand the company canceled its 125 million dollar ipo, gone, cancelled and now, mitt romney has a new ad attacking the administration's green energy agenda. now, listen to this. >> president obama is attacking mitt romney because mitt romney supports coal miners. but it's barack obama who said. >> so, if somebody wants to build a coal fired plant they can it's just it will bankrupt them. >> obama wages war on coal while

we lose jobs to china and pushing more coal every day, now your job is in danger. stuart: the smith electric brings the green energy debate front and center. and carol roth joins us now, you're an investment banker. i don't think that the government's track record to try to act as an investment bank, investing energy winners, the track record is lousy. >> no, everybody's down on the private equity community, but the bain track record and mitt romney's track record has been really good and the middle class has made a lot of money and their pension funds off of that. but the american taxpayers have not done very well with the private equity firm of our government. they keep putting money into solyndras and now smith electric, and guess what? their track record is terrible. i'm hearing that smith electric, now at that they're pulling this ipo, may end up going out of business, because they don't have enough capital to operate. so, we need for our government

to stop acting as a private equity firm and let the private equity people do that and take those policies and people who know how to invest the money and let those people be our leaders, stuart. stuart: the president is not listening to you or anybody else with your opinion. i mean, he's doubling down on green energy. they are he' going to increase the subsidies to the companies they think are going be to be winners. there's no retreat here on green energy, seriously, nothing at all. >> no, that's a typical trading list, you put money good money after bad. say, i've got a really bad stock, now it's cheap and i'm going to double down on it. that's a terrible portfolio strategy, something is not working, the definition of insanity is going down the same path and expecting a different result. and you have to realize-- >> it might work for youngsters like you. and i'm not joking now, i'm saying, look, i'm for the future. i'm for green energy. forget coal. that's an awful, ugly thing. oil, it just pollutes, oh, but

beautiful things like wind mills, solar power and green energy, that's the future. that is an appealing political line isn't it? >> it's a very appealing political line. you know who it's particularly appealing to, to the idealistic youth vote. that's not a coincidence near the election we're going back to touting green energy. from the american people's standpoint, what we want is an economy that works, we want a national debt that's shrinking, we need to get away from this idealistic standpoint and get into a realistic standpoint and focus on our future otherwise we're all going to be in trouble here. >> carol roth come up to new york and join the company soon, please, appreciate you being with us from orlando. >> thanks, stuart. stuart: all right, it's 9:40 eastern time the dow is up 50 and i've got 7 early movers for you this thursday morning. the rv maker, thor, reported better than expected profits,

how about that with near $4 gasoline. 36.40 it's up 5%. paint maker hb fuller lowered its outlook and that's bad and the food packing manufacturer landeck, the stock is up a little not much. and medical equipment maker, how do you pronounce that, cepheid, that stock is down. google, shares up 17% this year, 761, up another 8 bucks now. the mattress make tempur-pedic, that's up. and sealy up 4% not huge, but 4% i'll take it. the dow is now up.

13rs 457. hillary clinton is the latest and highest ranking government official to confirm the attack in libya was tied to al qaeda. meanwhile, mahmoud ahmadinejad using the united nations to spout more hatred. when is president obama's middle east policy stand right now? ambassador john bolton joins us next. [ male announcer ] at scottrade, you won't just find us online, you'll also find us in person, with dedicated support teams at over 500 branches nationwide. so when you call or visit, you can ask for a name you know. because personal service starts with a real person.

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secretary of state hillary clinton now hints that al qaeda was involved in the attack on the u.s. consulate in libya before they blamed the violence on an anti-muslim youtube movie. yesterday mahmoud ahmadinejad called for a new world order at the united nations. john bolton former ambassador to the u.n. is here. i want you to characterize the overallstate of america's relationships and policy with the middle east. >> i think it's in a complete shambles. we failed to stop iran's quest for nuclear weapons and failed to stop the al qaeda terrorism in libya on september 11th, we failed to make any progress in the israel-palestinian peace process. we've seen the arab spring go badly wrong with the rise of islamist powers, all of which i think is a signal of declining american influence in the region. stuart: well, if you were in charge of foreign policy. if you were secretary of state in the unlikely event-- sorry, but what would you do? what would your policy be? >> well, you can't dig yourself

out of a hole immediately, but i think what you make clear, that the united states will stand up for its interests and deal with the iran's quest for nuclear weapons and if they cross that line. stuart: bb netanyahu says they have enough for 2013. >> they can make sticks to eight nuclear weapons based on the amount of enriched uranium if they take it up to weapons grade. that's what we've known. what i've feared is our intelligence isn't perfect and there's a much bigger iranian weapons program. and they're close to their 20 year objective of getting nuclear weapons. stuart: we know that they're four to six months from having a bomb. >> this is simply a matter of technical changes to what they've got already. stuart: the dynamic, we must not-- we, israel with america, will attack, must attack. >> not the obama administration.

you know, the most likely outcome right now is that iran will get nuclear weapons and not only that once they get nuclear weapons so will saudi arabia, so will egypt and so will turkey, the only thing that stands between iran and nuclear wednesday is a military strike by somebody. and the sanctions had an economic effect, this is true, but not slowed the nuclear weapons program down. stuart: we know it, the president certainly knows it, why is he reluctant to take a firm stand both against iran and the new militant in north africa? >> only one explanation, his ideology leads him to fear an israeli strike against iran more than an israeli nuclear weapon. i think he believes, though he denies it, that you can contain and deter a nuclear iran. i think that shows his lack of concern-- >> let's be blunt about it. that our president made a flat-out tilt towards islam and away from israel? >> i don't know of any president

who has isolated israel more and whose vision, and understanding of the muslim world, we have allies among the arab states and muslim world and alienating them by his tacit support at least for morsi and the muslim brotherhood in eget and his unwillingness to take on the terrorists like al qaeda who hurt muslims as much as they threaten the west. stuart: i wish we had more time. you dealt with two of the big issues of the day, thank you. >> thank you. stuart: time for the gold report, 9:50 eastern, where are we this morning, 1,765, we're up 11 bucks this morning. interesting story, sears and the parent company of olive garden, the restaurant chain, could be pioneers in changing the way companies provide health care to their employees. will it make it cheaper for you to see he a doctor? what is this new way of doing it? interesting stuff. doug schoen will join me in the studio next with that one. ♪

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>> you know, i find it interesting. two major companies making a big shift in how they offer health care coverage to their workers. sears and darden restaurants will now give employees a fixed

sum of money and let the employees choose the type of medical coverage and the degree of medical coverage that they want. it's sort of like a 401(k) plan for health insurance. former advisor doug schoen is here, i think it's a great idea. how about you. >> as do i. introduces competition into business and makes employers more cost conscious and gives employees a choice of who they want to work for. stuart: so if i'm the employer, you work for me, i give you x number of dollars and you go out and choose between health insurers who do you want. >> they compete and employers compete to get employees based on what they offer. it reduces the risk to employers and employees. stuart: you're not a democrat. you're just like me and that's a real problem for you. >> you used it be a democrat. >> 40 days to go to the election. who has the edge? depends on which polls you're looking at. should we be looking at them at

all? doug schoen says maybe not. we're doing a disservice by focusing on polls, that's what he says. the growing criticism of polls is our new at 10 story, and doug is here with it. plus, the refs return tonight. what did they get. did the league take a hit in this whole mess? i don't think so. nfl hall-of-famer, fran tarkenson will also be with us next. [ female announcer ] they can be enlightening.

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>> new at 10, growing criticism against polls. do they tell the real story? are we missing something by just focusing on those numbers? doug schoen who helped run successful campaigns for president bill clinton, he says yes. and we're talking about that with him in just one minute. check the big board, we're now up just 33 points. still though, the dow is at 13,447. let me introduce to you our company this thursday morning. charles payne is with us, democratic strategist doug schoen is here and nicole petallides on the floor of the new york stock exchange. hold on a second. pending home sales down 2.6%. very interesting. that's month to month, okay? so the latest month showed a 2.6% decline, month over month, but year on year, up 10.7%.

interesting picture. 3.40%, that's the most important number to me quite frankly, 3.40%, that is the 30-year fixed rate loan from freddie mac. can you believe that, 3.40%. >> i'm pretty sure i'm right in saying that's an all time record low. 3.49 last week, 3.40 this week. not bad. no impact on the market, dow industrials still up 33 points. okay? and no impact on all of these housing numbers, and the mortgage number, no impact on stock prices, at least not, not immediately. okay? and let's go to nicole, apparently a lot of money in mattresses today. tell me the story, please. >> well you like tempur-pedic or the sealy pospedic, they're hard to say. and they've made a move to acquire sealy and why you see the two companies, tempur-pedic

up and the deal is valued at 229 million. 2.8% premium. why are they doing it? well, here is what the ceo of sealy said. to deliver more value by leveraging our strong combined assets. i don't know, stuart, i went to tell you they're operating separately and still going to get two completely different mattresses, but because of stiff competition they're getting together. stuart: operating separately, separate different companies, but they're getting together and both of them go up? i'm trying to get to grips with this one and we will, we will get there. thanks very much, nicole. the dow is up 38 points. now, our new at 10 story, we've been on it all week, the mainstream polls on the november election are skewed towards democrats. in a fox news.com opinion article, doug schoen rights regardless of the approval rating for swing state polls, the real issues are being ignored.

doug, you're saying don't do these polls, don't look at the polls, ignore them, they are he' bad for democracy. >> i'm saying something bigger than that. the polls are not healthy for democracy. they're about ideas and ideals, the number of people are dissatisfied with the their government, dissatisfied with the economy and dissatisfied the direction our country is going in. obama has a lead probably not as big as polls suggest. the larger question, the americans feel the country is directionless, the real issue in this country, in this election. charles: for what i'm concerned about, the idea that the polls determine who wins. before the polls were giving awe snapshot who wins and now the polls sort of sway the election themselves. >> and we now live in a period of horse race democracy. and bottom line, the mainstream media contributes to that, it's not what the candidates say or what they didn't say, who is ahead and who is behind frequently with faulty polls.

stuart: the polls are instead faulty, i think they're distributely skewed to the left of center. >> i think they built in every assumption that benefits the left with that being said. obama is ahead, that's for sure. stuart: the mainstream media chooses to build in every advantage to the left. they don't choose to do that, they make a value judgment. >> by accident that rasmussen and gallup, two independent polls that are professional full-time political polls, have the race much closer than every mainstream media poll. stuart: of course, you can't just say no more polling. you can't say that. >> that's my life's work, so i hope-- >> and hipocracy and you're the guy on wa-- but you're the guy, you did all of those polls for president clinton. you're still doing poll. >> they were all private polls designed for a strategy. stuart: private polls are okay because they're not in the mainstream. mainstream forms are bad. >> do welfare reform, get a

balanced budget and both good initiatives in the 1990's. stuart: do you have a comment charles. charles: for someone like doug to come in and talk about it is important. polls seem to be the number one issue and are swaying the election. stuart: what we should do, you can't ban polls as unconstitutional. you can't do that, understood. we should ignore them, what we're saying. >> we should focus on the ideas and issues that are important in an election, not who is ahead and who is behind. >> your position, you agree with it. the story i'm told gripped the rest of the world all week, the nfl referees, their strike, they'll return to the field tonight ravens against baltimore. and refs make 205,000 a year by 2019. remind you for a half year's work, along with a pay raise, the refs also get guaranteed

pension benefits. hall of fame quarterback fran tarkenton joins us now from atlanta. fran, question number one, is looks to me like the refs won hands down. do you agree? >> no question about it. as that play at midnight monday night that went seattle's way, it was no controversy if they stole a victory away from the packers and after that, the referees won. and i think that right away that the league will capitulate, everything, and the referees will get what they want and they did and you're going to have thursday night football tonight with the old nfl referees. stuart: so, turn it around. does the nfl look bad because they surely caved? and do the nfl owners look greedy. got a 9 billion dollar a year industry. and they didn't cave until they were forced to by a bad call on a monday night football game? >> well, keep in mind, all the

owners of a national football league are billionaires and this league is the most popular league in the world and the owners are not used to being told what to do and you've got referees, that are not like players or coaches. and they felt they could bully them down and make them take whatever they wanted to take and they were doing all right until they put the replacement referees in and there was a debacle. it was an embarrassment. they had to cave because the game was being compromised. stuart: okay. so the union, the refs won. the nfl caved, but i think the football is a huge winner. no problem with football whatsoever? >> no, i mean, the start of this season has been one of the greatest starts i've ever seen. the games are great. the talent is great. coaches are great and the television ratings are off the charts again. and people are not going to stop watching the nfl.

they watch it more every year. it's more popular. the biggest challenge of the nfl is filling up the stadiums, because the television experience is so great with all the flat screens and all the directv's and all the games. who wants to go sit in the stadium, not many. so they're having trouble filling up all the stadiums. stuart: okay, i've got one more he question for you and it's this: i'm told that there is a lawsuit being filed by former players who suffered injury during their playing time and were not compensated for those injuries. i think it's going to-- they're looking for a class action settlement, somewhat similar to the tobacco settlement, where there's a huge lump sum payment. a, is that likely to happen. and b, if it does happen. wouldn't that change the economics of football and the game itself going forward? >> well, the economics of football are so stunning to me, when i came up in 61, each team got about 20,000 dollars for

television and 2014 they could only get 150 million per team. i think they're going to get something in the area of 12 million of revenue from the nfl. these lawsuits are going out because of course, you know, there's a lot of money in the nfl. i don't think they'll go many places. i had concussions, i'm not part of the lawsuit. i don't think you could go back and blame people for concussions 30 years ago, 40 years ago, 20 years ago. but, you know, lawyers will chase the ambulance and they'll try to go after the big money thing. i don't think it would make an economic difference to the nfl and i don't think they'll be successful. stuart: i like that line, lawyers will go after the money. air welcome on this program, fran tarkenton, that's a fact. and remind people about fran's website, one more customer.com, i'll repeat that. onemorecustomer.com. and a new poll commissioned by the manufacturers, 55% of small

business says it would not start a business today. and blames president obama's anti-business policies. charles, what are you going to say? >> this is not new to us, i'm glad the poll is taken, and people understand that because of how important small businesses are. and that's the cog, what makes our economy going. 90% of the hiring if you consider 500 or less small business and the point is, listen, 33 of them not even confirmed by the senate, all powerful epa, nlrb. and here is the problem, the administration went to war against businesses. for the most part, big businesses, but all the collateral damage is happening to the small guys. big businesses get hired, armies of lawyers that work for the administration, lawyers may go at it and dodd frank drags on and on and the small guy suffers. stuart: and let me interrupt for a second. could it be in the last four years, america has been changed by this president and a majority of americans really are

anti-business? is that not possible? >> i don't believe it's true. stuart: you don't think so. >> the american people are anti-uncertainty. we don't know about our health care policies, we don't know about our taxing policies. we don't know about our bugetary policies. charles, i'm a small business businessman, so are you. i stopped hiring when i'm uncertain. >> but stop-- we're talking about guys saying they wouldn't start a business. wouldn't stop someone from-- most the time you start a business you're not sure. all of these we talk about, you don't know, borrow money from your parents, save up cash. >> you don't start one and you also don't expand one. it's the guy with one or two employees who you want to go to four or five that saw something. >> and i think it's part of that whole drop-out nation thing i have be been talking about. i was in vegas and guy from italy and belize. he's started a business and in the printing industry and it's harder, intimidating with the war on success, but americans

themselves, i think, are forget about how great this country is. other people know around the world how great we are and that's why they still, you know, jump on life rafts to get here. stuart: charles, thank you. back to nicole, a winner, and i don't know who it is. tell us and why is it a winner? >> well, we're looking at discover financial, the credit card company is a winner, a top performer in the s&p 500 today. a couple of things, to your point, i know you guys were talking about uncertainty and a tough economy, whether people are hiring. that's something that the credit card stores really saw during the financial crisis. people aren't spending as much, obviously, didn't have the confidence as the job picture has improved slightly. we've seen confidence improving and customers are spending more. not only are they spending more, but also, there are more transactions and fewer customers are actually defaulting on what they borrowed. and that's the big picture and that's why discover beat the street with quarterly numbers and up arrows, last spot. pay pal. they signed a deal with pay pal and we'll see that.

stuart: we hear it. thank you very much, nicole, put the cameraen 0 the big board a second. we're only up 13 points. we were going to be up 65, 70 points before the market opened and bad news on gdp, growing at 1.3%, and shortly we'll hear how big a retrenchment is going to be in place in spain, how many more budget cuts are coming up there. that will affect our market. so, the big gain is largely evaporated and we're up just 16. now to mitt romney, he gave millions of dollars to his grandchildren by creating a trust. he avoided most taxes in the process. and he avoided taxes, it was legally. that was his way to take care of his heirs, why is he being criticized for it? ed butowsky does this kind of financial planning for his clients all the time. he joins us next.

>> just breaking top of the hour. 15 minutes ago, the freddie mac 30 year mortgage rate hits a record low. 3.40%. and off in the housing market. august pending home sales up 10% compared to the same period last year. the labor department though says 359,000 people on first time jobless benefits claims better than expected, less than last week, but still a very high number in a recovery from recession. and bad news on gdp. really bad news, the economy growing only at a 1.3% annual rate in the second quarter.

1.3%. revised down. much weaker than previously expected and the commerce department blames the drought in the midwest, i don't think so. up next, mitt romney sets up a trust for his grandkids, pays a lot less in taxes, legal. but why is he getting critici d criticized? manager, ed butowsky.

. stuart: the company that makes the blackhawk helicopter cutting 570 jobs.

defense companies like sekorski make more in anticipation of more defense spending cuts after the first of the year. sekorski down 570 jobs. mitt romney avoided much of -- a lot of taxation when he set up a trust to give millions to his grandchildren. perfectly legal way to take care of his heirs, he's criticized for it. ed butowsky with chapwood investments. what did he do, did he avoid tax or minimize tax? >> he took advantage of exactly what the tax code was, he didn't avoid it, he delayed it. it's important for people to understand. a lot of tax planning goes into when you're a wealthy individual and we applaud he took money-- excuse me took stock and low cost basis into a trust. a republican or democrat you can do that. what he did at that point no money was taxed at all on that, on those assets. in this case double click stock, it went up. and about this, normally when you have a trust, the trust will

pay the tax. in this case he set up grantor trust which means he's paying the taxes on that not the trust. so the idea that he avoided taxes is just not true. you get a certain amount of gift taxes when we're all sitting right a certain amount of gift tax to use that when you die or while you're alive. he used some of that alive and the nice thing he's passing along this to his grandkids and his kids, teaching them and helping them how to manage money and work with it. it's a benefit at the same time the take away from the whole thing, stuart, this is not a simple thing, it's confusing, he did not avoid taxes, he's delaying it and paying taxes when they sell the stock. stuart: he'll be demonized because he avoided paying some tax and because he's rich, demonize $. >> he'll be demonized, but that's, we live in a country right now people don't understand something they default to something was wrong with it. there's nothing wrong with it, these are the rules.

stuart: you've got a lot to say about the 1.3% growth rate. i call that abysmal and stall speed for the economy. but you manage people's money. you're an investor. and what do you say about that from the perspective of a money manager. >> how can you not look at this and say, all right, we printed money to try to stimulate the economy and what we've gotten is prices rising. when you print money, prices of what you have right now goes up because the value of what you currently own goes down. meaning the dollars that you have now, when you print more, is worth less. so, he did that to stimulate the economy, and it isn't working. i mean, anybody that goes back and look at the gdp charts, quarterly gdp charts. since he took office after they were up around 3.5, 3.9. it has progressively gotten lower on his policies. not bush's policies. on his policies. and we're sitting here at 1.3% gdp and that got ratcheted down lower. it's not working. we've the got to get rid of this guy. stuart: so, printing money, stimulate the market, the stock

market, the stocks go up. stimulate the price of gold, goes up. oil goes up, but it does not stimulate the overall economy. would anybody here care to disagree with that. >> no, one thing i'll tell you the obama administration is focused not on the long-term. they're focused november 6th. stuart: so, printing money helps president obama he thinks. >> absolutely through the election, and that's what they care about. stuart: last word. >> the problem it shouldn't help him. we ought to blame the people cost of their living year by year, gets worse and more expensive because of his policies. and we're getting nothing. if the gdp was growing, we were 3%, 3 1/2% we could say hey, things are working, they're not. stuart: i don't think i've ever seen ed butowsky quite as fired up. >> sick and tired of it. stuart: all right, we heard you. and ed butowsky, thank you very much. >> thank you. stuart: if paul ryan becomes the next vice-president, someone else will become the head of the next house budget committee.

scott garrett, republican from new jersey wants the job. what would he do if he got it. we'll ask him because he'll be in this studio next. [ male announcer ] you are a business pro.

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>> like playing in a basketball game, i get two points for a basket and you get 10. it is ridiculous. stuart: are the polls accurate?

>> i don't even think they're accurate. i told you this before. we would put them in jail for securities fraud. stuart: that is a good one, wasn't it? rudy giuliani talking about mitt romney's tax plan. don't miss a minute of barney and company. check the market, much of the early game is gone. we're still up. the price of gold up again $15 higher. oil is back $91 per barrel. a solid gain. the price of a gallon of a dollar of regular, $3.80. diesel holding firm $4.09. google's 14th birthday today. so, nicole, where is the stock? did you bring a gift?

nicole: google 14th birthday. of arrows just shy of the all-time high. you can see it up right now. up 1%. it hit that high on september 25, 2 days ago, not too far off. stuart: i wish i would have known it was 14 years ago, 14 years later google would be $758. nicole: i was waiting for you. what do you think? stuart: that is pretty good, from what i can see. nicole: happy birthday, google. stuart: thank you. don't just feels up 18 points. express interest of a chairmanship position of the house chairman committee. sitting here with us in new york right now. congressman, welcome. >> it is always a pleasure to be with you. we were pleasantly surprised,

happily surprised when he was the nominee picked to be his vice president shall running mate. i don't think that romney could have picked anybody better in terms of being knowledgeable, articulate. he is so great. i say in a positive sense, that is exactly what the country needs. stuart: what policy would you bring to the challenge of the house budget committee? what would you do? >> it is a neat time for whoever will be in that position to be the chairman. the next chairman assuming we get romney in the white house, we have the white house again, the next chairman will be shooting with bullets. they have asked a number of budgets before, this time our

budget will effectively become the blueprint for the economy going forward. stuart: would you take us over the fiscal cliff? by that, what would you do about taxes? go, texas. >> i would abide by the republican policy and philosophy which is to say when you're in a recession this is not the time to raise taxes. i have never voted for a tax increase, so what we need to do is set up the framework in the committee, exactly as you said some of the more details in the ways and means committee. lowering the tax rates. stuart: lower tax rates. >> yes, sir. stuart: eradicate or limits on deductions? which deductions? i have to ask. what would you limit? would you limit further mortgage

interest deductions? would you limit in some way the auction for state and local taxes? would you limit the deduction for charitable donations? >> one of the more controversial would have to be the mortgage interest deduction. there is already a discussion in washington from the stakeholders and interested parties say never, ever touch it whatsoever. even they have said maybe there is some area for room of reform as far as secondary. i think the next congress, regardless of who is in the white house, has look at these issues and everything has to be on the table. stuart: they would be all on the table? >> i think they would be fair game. does that mean they would be eliminated? we are not saying that. but more equitable, certainly.

stuart: if you cut tax rates you have to cut deductions, very serious cuts to make up the revenue. >> certainly. the last several years the democrats said what are you going to do with corporate deductions? we never really fought back on that. if you ask what really is the terms of the deduction corporate site, they have no clue, but our response should have been we will take a look at it as well and maybe there will be adjustments there as well. i looked into that and said what is the actual change of deduction we are talking about? they change in the linear line of the amortization schedule, that is what we are talking about. democrats play that off meaning the bigwigs can get some advantage. stuart: still a democrat, he wants to get you to say i'm all

in favor of these. >> i don't think you don't want to hurt the economy just for political points. stuart: i am with you. i think we are on the same page. >> i think we are. stuart: your hat is in the ring if paul ryan becomes a vice presidents. >> everyone hopes. stuart: thank you for being with us. >> thank you much. stuart: women are a huge part of the presidential election, and now a top obama campaign advisor says women haven't been paying attention the past four years. could that cost the president votes? and how the romney camp can make up a big gap among women voters. next.

so, we all set?

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i am reading the gdp number this morning, a mere 1.3% growth rate, that is flat out terrible. how about you? >> how can i not agree with that? can we base the economic fact once you get a debt to gdp level on the government level, once you get debt to gdp up above a certain amount it becomes a significant headwind to economy. it has every single economic history, our significant government debt is providing a big part of that headwind. stuart: how does that work? i know our debt is now bigger than our economy. bigger than the economy, but how does that shrink the economy or limited growth rate? >> here's how you expand gdp. you expand gdp by an increase of population and an increase in productivity, so all those

assets being used to lend money to the government, those are assets that could be invested to expand collectivity. if you don't increase productivity by raising taxes, you don't increase productivity by changing the schedule and things like that can increase productivity by capital investment and that is simply not happening. the money lent to our government is dead money and is not out investing in productive assets. stuart: are we going to recession? >> it would be hard to argue not. i was having this discussion last night, isn't it odd we see a couple diametrically opposed views of economically growth in washington right now? ben bernanke trying to create the wealth effect. everybody feels more wealthy because the asset prices are going up, that helps the economy come around. by the same token if you look to the democratic side of things, if you look at the other guys,

now we have to expand government and that will get the economy turning. i found that odd both of those are being played together at the exact same time right now. stuart: see you again soon. according to new polls for president obama has a big lead in the female vote over mitt romney. in ohio the president leads romney 60-35 among women. now obama deputy campaign manager says women don't care about the president's record. listen to this. >> they're not really concerned about what is happening over the last four years. stuart: congresswoman joins us now. it is very hard to get around or

explain the enormous lead president obama seems to have among women voters. i put it to you they're going to be president because they're getting bought on that issue. tell me i am wrong. >> i do think you're a little bit wrong on this one. so many women are still undecided in this election, and the issue is jobs and the economy are the number one issue. when i'm around the country talking with women, what i hear from them is their concern about the out-of-control federal spending, concerned about jobs and the economy, those are the top issues with women and i have to tell you, i would take them to tone on wha than what she hao say. they say women have dismissed or are not paying attention or

don't care is so incredibly disrespectful. i think women everyday till the children you have to know your history in order to understand the present and to know what to look for in the future. and whether it is a country or themselves individually, they're looking at this. stuart: it is hard to explain a 20-point gap. >> quick question, governor romney is talking about the things you're talking about yet trailing by larger and larger margins among women voters especially in swing states. why is that happening? >> i can't tell you exactly what i think that is happening because when we talk to women jobs and the economy are issue number one. they don't like the fact that high schoolers cannot find college work or jobs, they are seeing wage stagnation.

the uncertainty for the small business owners is driving them crazy but it is access to capital or regulation coming from agencies. stuart: i'm terribly sorry, we are short on time this morning, it is a full newsday, but thank you for joining us. >> good to be with you. stuart: unemployment is high, income is down, one option, selling a life insurance policy for cash now. we will talk the ce to the ceo a company who does exactly that. if his business is doing well, does that mean the economy is back? even betty white making commercials for them.

stuart: here's a report for the labor department, 339,000 people filed first on jobless benefits last week. less than last week, but a very high number. crossing the wires at the top of the hour, the fixed rate mortgage firm freddie mac an all-time low. 3.40% down nearly one point, a tenth of a point from last week. we got the housing market news,

up 10% compared to last year. the market dragging because bad news on gdp. revised down again, much weaker than expected. the department blames the drought in the midwest. in 90 seconds, stay there. like in a special opsission? you'd spot movement, gather intelligence with minimal collateral damage. but rather than neutralizing enemies in their sleep, you'd be targeting stocks to trade. well, that's what trade architect's heat maps do. they make you a trading assassin. trade architect. td ameritrade's empowering web-based trading platform. trade commission-free for 60 days, and we'll throw in up to $600 when you open an account. ♪

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stuart: since president obama took office, medium income is down 8.2%. unemployment still 8%. people giving up hope. that is what some people say. some americans are selling their life insurance policies for a cash payout. what is the name of the company? >> the lifeline program. stuart: you would buy my life insurance policy before i died, give me cash for it $0.20 on the dollar, you get the policy and get paid off when i die, is that correct? and i pay cash. >> it would subtract the price. stuart: are you, i know your business is up because you are on this program all the time, but her business is up. suggesting that is because this is a down economy, a push

towards cashing out their life insurance programs. >> anytime there is a fluctuation, people are looking for options. we are hopeful all advisories and attorneys are paying attention to them in their retirement package. anytime there is a fluctuation, a life settlement might be the answer. stuart: people in their 50s, out of a job, little short of actual retirement age, they want a cash deal to see them through? >> will at december the 70 plus coming to us, however invest in the settlements because there is the sandwich generation they're taking care of their children, caring for their parents instead of doing that every year, people need to get back in the game.

stuart: this is fascinating stuff. you give a medical check? >> look at the medical history. stuart: the worst they are healthwise more likely they get a higher payout than 20%? >> typically the older, the more money you will get. >> we had a policy to buy cattle because they thought they could restock versus getting a lump-sum settlement. stuart: really are betting on death, aren't you? what is the average age? >> late 70s, early 80s. >> social security, medicare,

this is an indictment on the fact they are so faulty, we live longer, live to see 65 be 85 more than likely. stuart: the people who have not saved enough money on their own. >> 's only people in america are told social security system is your safety net. you don't have to save on your own, to have a quality of life, it will be eaten up via inflation. >> they are not relying on social security. $2.5 million, talking about a more fluid client base that utilizes for the whole financial planning institute. collecting social security living off of disability. and you know what, why not spend it today. stuart: my mother's expression

was have ever seen a shroud with pockets? >> there you go. i think you have enough free commercials. when you come back and join us again? >> absolutely would love to. i am calling it the enthusiasm gap. are people excited about a second obama term? next.

stuart: coming up on "lou dobbs tonight" at 7:00 p.m. eastern. where the world is obama leading us? a new world order? the master john bolted joins us tonight at seven eastern. stuart: here's my take on what is being called the enthusiasm gap. the gap between the enthusiasm by the democrats, and the enthusiasm expressed by the challenger, mitt romney. i think it is very wide. how many people have you met were really gung for a second term? this is what america must have. we need desperately for more years. i don't hear that much. in fact, haven't heard it at all. now you can say i indeed move only in conservative circles and

that is true to some degree but i daily basis i talk politics with a wide variety of people who don't know my background and i have seen very little enthusiasm for this president. now the reverse question, how may people have you met are very unhappy with this president who believes we absolutely must change course? answer, a lot. overwhelming people are passionate in rejecting the last four years. that is the enthusiasm gap and exactly why the recent polls are not an accurate reflection to the vote on election day. if you lack enthusiasm, you're less likely to vote. if you adamantly oppose the president, you get out there and make your voting voice count. this is all about turnout. lick assiduous turnout in the same numbers in '08? i think not. there is an enthusiasm gap and that is why don't trust this

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stuart: here it is, the highlight reel. roll it please. >> president obama still leads in the polls especially in the key state of ohio. >> i suspect it has more to do with internal polls. >> i'm saying the polls are not healthy for democracy. stuart: the mainstream polls in the november election are skewed towards democrats. >> now the polls sort of sway the election itself. stuart: you can't just say no more polling, you can't say that. >> that's my life's work so i hope you wouldn't say it. stuart: we should ignore them. that's what you are saying. ? >> it is playing in a basketball game and i get 2 points for a basket and you get 10. stuart: that was a good line. doug schoen has a couple of words to say about my enthusiasm. >> your analysis is right. you left one thing out. there's complete dissatisfaction with governor romney, arguably

more than with president obama. stuart: wrong, you are taking your opinions from the establishment media, which is always going to be skewing left. charles? charles: so far 2.7 million people knocked on doors for romney. the entire election for the republicans for the last election, 2.4. there's a difference there. stuart: okay. dagen and connell? dagen: i'm dagen mcdowell. connell: i'm connell mcshane. it is now versus the then economy. dan henniger from "wall street journal" says it is time the president stops blaming president bush and take a look at what's going on now. dagen: before the break, why you should be investing, you have the wind at your back right now. connell: and the default part twhe